High Country Times

Education and the Workforce Committee Chairwoman Virginia Foxx (R-NC) has initiated an inquiry into the use of pension plan holdings by unions for shareholder proxy voting activism. Letters were sent to International Brotherhood of Teamsters President Sean O’Brien, AFL-CIO President Elizabeth Shuler, and Service Employees International Union President Mary Kay Henry.

In her letters, Foxx stated: “In recent years, unions have engaged in significant shareholder proxy voting activities by leveraging their significant pension plan holdings. In light of recent high-profile proxy votes pushed by unions, the Committee on Education and the Workforce (Committee) is investigating shareholder activism activities that involve assets held by union pension plans, the impact on the value of the pension plan investments, and the expenses incurred by the plans in pursuit of these activities. As part of this investigation, the Committee is making this inquiry to understand the practice of proxy voting by your union.”

Foxx emphasized: “The Employee Retirement Income Security Act of 1974 (ERISA) provides that a fiduciary, such as one who manages the assets of a pension plan, shall discharge his or her duties ‘for the exclusive purpose of (i) providing benefits to participants and their beneficiaries, and (ii) defraying reasonable expenses of administering the plan.’ Given that some shareholder activism may not increase investment returns and may impose expenses on a plan, the Committee is seeking to understand these practices.”

Foxx requested detailed information from each union leader regarding their engagement in shareholder activism:

- Explanation of how their union engages in shareholder activism or related activities.

- The number of shareholder resolutions filed or supported by their union that received majority support.

- The number of staff members involved in activities related to shareholder activism.

- Mechanisms in place to determine expenditures on shareholder activism and associated figures.

- Mechanisms to calculate financial benefits from these activities and results if available.

- Partnerships with other groups during such engagements.

- Targeting companies for organizing efforts through shareholder proposals.

- Use of stock held as a union pension asset for proxy voting considering its impact on financial health.

The letters also inquire about expenses incurred in these activities and whether pension plan assets were used to fund them.

To read Foxx’s letter to O’Brien [click here](#).

To read Foxx’s letter to Shuler [click here](#).

To read Foxx’s letter to Henry [click here](#).